Crowdlending decisions for sustainable new ventures: The role of underlying human values in explaining the heterogeneity of crowd investor preferences

Abstract

Crowdlending for sustainable new ventures is situated between traditional investing and charitable giving, thereby attracting non-professional investors with different motivations. However, the current understanding of these different motivations related to crowdlending decisions is limited. Drawing on the theory of basic human values, the present article addresses the question of whether and how crowd investors differ regarding the factors that drive their crowdlending decisions for sustainable new ventures. Using a choice-based conjoint analysis followed by a latent class analysis, this study explores the preferences of 353 non-professional investors in response to project attributes associated with loan characteristics and sustainability impact goals. The results reveal four crowd investor segments with heterogeneous preference structures and highlight the role of human values to identify such segments. While the majority of crowd investors form their decisions around financial return rates, the segment of crowd investors characterized by high self-transcendence and low self-enhancement values focuses primarily on ecological impact goals. Surprisingly, crowd investors who prefer social over ecological impact goals are characterized by high self-enhancement values and thus appear to be motivated by self-interest. These insights are significant for sustainable entrepreneurs and platforms, helping them to better address the diverse audience in crowdlending.